Trial to consider whether Public Works bent rules in $428M contractBack to video

Powell’s $250 million suit comes hard on the heels of the epic legal battle between Public Works and Envoy Relocation Services — the firm that lost a $300-million contract to move military, diplomatic and other government workers. Justice Peter Annis last year ordered the government to pay $40 million to Envoy after determining that procurement officials had effectively steered the 2004 contract to Royal LePage Relocation Services.

Powell hopes during a scheduled six-week trial to establish that a similar pattern of behaviour was behind his 2008 loss to CGI. A major difference between the two cases is that Envoy was attempting to unseat an incumbent — usually a more difficult prospect — while Powell’s TPG Technology had been providing information technology services to Public Works since 1999.

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It was widely known at the time that Public Works officials wanted to move away from smaller firms such TPG — which employ a small cadre of full-time employees who direct the activities of dozens of independent IT specialists. CGI Group of Montreal in contrast has thousands of consultants and IT experts on staff. The question facing the court will be whether Public Works abandoned fair play in setting and interpreting the rules for the contract.

Powell has spent a small fortune developing his case, starting with four separate appeals to the Canadian International Trade Tribunal — the agency responsible for ruling on complaints about the government’s contracting decisions. He launched his $250-million suit for economic injury after the fourth appeal was rejected.

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The Tribunal ruled that whatever obstacles were put in Powell’s way, they weren’t enough to affect the final result in favour of CGI Group. Powell disagreed emphatically noting in particular that TPG was ranked dead last on its ability to manage the transition to the new contract. This was indeed puzzling as no transition would have been necessary for an incumbent supplier.

Powell complained often and publicly. After he launched his lawsuit in 2008, he testified before a House of Commons committee about the unfairness of the bidding process. Within weeks, the federal Competition Bureau advised him and other business colleagues that they would soon face criminal bid-rigging charges in connection with a 2005 Canada Border Services Agency contract — a move Powell contends was retribution for his unwillingness to go quietly after losing to CGI at Public Works.

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The Competition Bureau made good on its threat in February 2009 when it charged Power, TPG and 15 other individuals and businesses — most of them Ottawa-based — with bid-rigging. The trial associated with that action is scheduled for this September. Powell continues to do a lot of business with the federal government. Federal contracting data suggest that during the past two years alone, TPG has won $24 million worth of contracts, including $3 million from the Canada Border Services Agency.

Most of that money of course goes to Powell’s various contractors. And much of his own cut has gone to lawyers.

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Powell has spent millions fighting the government in the civil and criminal actions. When federal court judge David Near granted the government’s motion in 2011 to dismiss the civil action, Powell’s response was to file a complaint against Near with the Canadian Judicial Council, alleging a conflict of interest. Near was an adviser to Justice Minister Rob Nicholson when Powell launched his suit. However, the Council dismissed Powell’s complaint after finding “no evidence whatsoever of any improper motive” on Near’s part.

Powell nevertheless won the right to proceed with his civil action last summer when the Federal Court of Appeal overturned Near’s decision to dismiss the case. Indeed, one of the three judges referred to the surprisingly low technical scores awarded TPG during the 2007 bidding process that led to CGI’s victory.

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“The only reasonable conclusion,” Madam Justice Karen Sharlow wrote, “is that there is sufficient evidence to establish the existence of a genuine issue for trial on the allegation of an unfair bid evaluation.”

That’s a long way from establishing whether Powell actually has a case. That’s what the next six weeks of testimony and evidence are for.

Timeline for the $428M Engineering and Technical Support contract at the heart of the trial that begins May 12, 2014

1999

June 16: TPG Technology wins contract to run Public Works’ computer networks 2006 May 31: Public Works issues request for proposals to renew contract Sept. 5: TPG, IBM and Montreal-based CGI Group respond with bids 2007

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Early March: TPG learns it has lost to CGI March 23: TPG launches first of four complaints with Canadian International Trade Tribunal, citing perceived irregularities Dec. 20: Trade Tribunal rules TPG’s fourth complaint not valid 2008

March: TPG files $250M-lawsuit against Public Works for economic injury.

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